To create a 3D model with the height map, you'd need to create a grid mesh in a 3D modeller, for example in 3ds Max.

If you need the biggest possible coverage (terrain.party can export height maps covering between 18x18km and 8x8km), the default grid mesh dimensions should be 18x18km with a minimum of 600x600 cells (as each pixel on the height map corresponds to a height sample point for every 30 meters on the grid mesh).

The Displace Modifier should then be added to the grid mesh in 3ds Max, and you'd need to adjust the height scale based on the difference between the highest and the lowest altitude inside the 18x18km area.

Alternatively, you can of course also just play with the height maps from terrain.party directly in Lumion (via the Load terrain map button on the Landscape tab). However, the dimensions won't be correct as the Lumion Terrain covers 2000x2000 meters.

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Here's a quick example that uses the height map for Montserrat (from terrain.party). I noticed that it was small enough to fit inside the 18x18km selection sqare, and Wikipedia told me that the tallest peak on this island is 1236 meters above sea level, so it was very easy to scale it to the right size in 3ds Max.

The grid mesh was exported to Lumion via .FBX format and I simply added a separate plane with a Water material to it and placed some trees on the island with the Cluster Placement function. In addition I added the Real Skies Effect and a Reflection Effect with a single Reflection Plane for the plane with the Water Material.